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99 Trim Problem

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eecer

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Post Thu Apr 09, 2015 12:08 am

99 Trim Problem

So I saw the recent video with the 99 trim problem and thought I would post here what I was thinking. The quick answer: Have the people compare Brand first, Model second, and Trim third. Since brands and models need to be produced separately and trims tend to be extras that are considered last by consumers.

First I wanted to clarify how I see the issue not actually be present

We have a group of 100 people. 100% showed approval for B1M1T1 and 50% approval for B2M1T1. Both of the vehicles had the exact same scores as well. You get a 2:1 in sales on this (Since this is how you did it on your video). So 66 people buy the B1M1T1 and 33 buy the B2M1T1 and 1 person dies on his way to buy a new car.

Your issue was that you have 100% approval on the B1M1T1 and then 50% showed approval for the B2M1T1-99. You said that B2 got 98% sales (or 98% chance of sales), but that doesn't make sense because that's you suggesting that every person had to buy at least 1 of every car. If 50% approval from the same group of people is going towards the B2M1, and all the different Trimss are actually the same, that 50% is going to be the same 50 people who show interest in the original B2M1T1. The 50% who weren't interested have nothing to change their opinion. This means that the B1M1T1 would still get at least 50 sales. The remaining 50 people would be deciding between 100 cars. B2 would have a 99% chance in those sales but that still means they would only sell 49% of their trims if they only produced 1 of every trim. This also means that technically they only have a 49.5% chance of sales.

Now, let's say that the different B2 trims actually had a slight difference to work the system, and the slight difference makes every single person show interest to at least 1 of the B2M1 trims, and of course 1 person on the all B2M1 approval side loose interest in that trim to keep the stats the same. You would have the 100% approval on the B1M1T1 and 50% approval to the B1M1T1-50 (Using my above thought on this issue, you would only need 50 trims to appeal to the 50 people who weren't interested in B2). This generates a bit of an issue because comparing every person individually you would get 50 people who are going to consider either B1M1T1 or B1M1T(x) and then 50 people who are going to consider all of the vehicles. This means that overall they have 74% chance of sales.

While this may seem like a way to work the system, it is actually crippling B2 financially but increasing his chances of sales. Now B2 is having to pay to produce all the different trims. When you produce a vehicle, you decide how many you're going to put out on the market and see how well they sell and you need to purchase all the parts to do so. In order to guarantee they even could sell to everyone in that group, they would need to manufacture a minimum of 2 in every trim. Lets say they do that, well there's a 50/50 chance that they're going to sell 50 of their 100 B2M1's. This could be a huge loss in different parts that they had to buy, and it's a risk that you would only want to take if you had the excess cash with a new company that is trying to compete with you.

To wrap it all together, my first statement was compare Brand first, Model second, and Trim third. The reason for this is brands and models need to be produced separately meaning that players would be paying more to produce the same car but with a different brand/model name since they would have to pay for a different manufacturing facility to produce the different brand/model. Comparing trim last would resolve all the issues above. If people were showing 100% appeal towards the B1M1 and only 50% appeal to the B2M1, then the Trim wouldn't fluctuate those sales. I just thought that I would throw in my slight argument for the initial issue since I wasn't quite sure if I mistranslated what you were saying.
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Tyler

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Post Thu Apr 09, 2015 5:50 am

Re: 99 Trim Problem

The thing that I'm not quite clear on....

if people like the first one better - 100% desirability, why would ANYONE buy the second one?

An alternative, giving "some" wiggle room might be to square the desirabilitys, and also device each trim by the squareroot of the number of trims...

So in the example given....

B1M1T1= 100% = 10,000
B2M1T1-99 = 50% = 2,500

I dunno, it's a hard problem.

Maybe the fair thing to do is not consider trims at all directly for sales, just for each demo calculate the MOST desireable trim, and then only consider that one for purposes of determing which model gets bought, and then and only then look at all the trims and distribute the buyers?

Like basically the 1/3rd of customers decide to buy a B2M1, and then since they're all the same buy the 99 trims is roughly equal proportions?
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Kubboz

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Post Thu Apr 09, 2015 6:35 am

Re: 99 Trim Problem

Tyler wrote:If people like the first one better - 100% desirability, why would ANYONE buy the second one?


The main reason is because people are not quite rational buyers. I mean, Yugo did have clients, so a player's CrapCar Inc. should have clients first.

The other reason I could think of is the differences between individuals and their criteria within a category. These differences serve for a nice explanation for models that do differ much in design, but not too much in the score within the category.

There's also factors outside of the game scope ("Well, my uncle is a Cossack mechanic and will fix my 1000 for free...Okay, I'm taking it!"), but this is not that much of the reason.

As for the OP, this can be exploited with sub-brands, I believe.
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Packbat

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Post Thu Apr 09, 2015 7:00 am

Re: 99 Trim Problem

Tyler wrote:The thing that I'm not quite clear on....

if people like the first one better - 100% desirability, why would ANYONE buy the second one?

That was my starting point when I was thinking about the problem on the forums. The way I figured it was that the desirability number only includes part of the factors that affect a given buyer, and that other, random things (the example I used was, "This one is available in peacock blue") can overwhelm the difference for individual buyers. If you imagine that these random factors represent a normal distribution with a standard deviation of 116% desirability, then you would have 2/3rds of the customers who see the 100 as better and 1/3 who see the 50 as better. And then the rest of the problem comes into play.

The best idea I could come up with to post on the video was that sales of the second car was not 100% due to differences in taste, but partly due to availability. In my imagination, the 100% desirable car is going to be like the first generation BMW Mini - yes, it's lovely, people love it, but people also have a six-month waiting list before they can get one, and they have to get a ride to the next city over to pick it up. By contrast, they walk onto any dealer lot and get a new 50%-desirable car today. Basically, supply and demand will make the 100% car more expensive in some sense and the 50% car cheaper in some sense ... and if you're talking about the same total number of cars, having 99 different variations on the 50% car doesn't change the situation. In fact, 99 variations is way worse, because every one of those variations is going to be harder to find than the 100% car until the latter sells 99% of its stock.
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eecer

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Post Thu Apr 09, 2015 5:56 pm

Re: 99 Trim Problem

Tyler wrote:The thing that I'm not quite clear on....

if people like the first one better - 100% desirability, why would ANYONE buy the second one?

An alternative, giving "some" wiggle room might be to square the desirabilitys, and also device each trim by the squareroot of the number of trims...

So in the example given....

B1M1T1= 100% = 10,000
B2M1T1-99 = 50% = 2,500

I dunno, it's a hard problem.

Maybe the fair thing to do is not consider trims at all directly for sales, just for each demo calculate the MOST desireable trim, and then only consider that one for purposes of determing which model gets bought, and then and only then look at all the trims and distribute the buyers?

Like basically the 1/3rd of customers decide to buy a B2M1, and then since they're all the same buy the 99 trims is roughly equal proportions?


So the desirability is whether or not someone would consider buying a car I think. I was translating the issue as you have 100 people either saying, "Yes, I would buy that car" or, "No, I wouldn't buy it". This means that 100% of the 100 people would consider B1M1 and 50% of the people would consider the B2M1, so only 50 people would consider purchasing both. If all the ratings on the cars are the exact same and there is absolutely no difference then the final 50 people would randomly choose one or the other.

I honestly don't see the problem though because those 50 people left over are spontaneous and if the vehicles are the exact same what does it matter what brand they pick? B1 only needs to build 75 cars (50 for the people who are going to buy the cars no matter what and 25 to ensure they manage to get the remaining people who are 50/50). B2 on the other hand has to build 100 cars, 1 of every trim to ensure they get that increase chance of sales.

So lets say that the cars cost $1 to build and they are charging $2 for the car. B1 spends $75 to build their cars, and they are already guaranteed those 50 sales, so they make $100 in those 50 sales. Now B1 is up $25. B2, on the other hand, spends $100 to make all their trims. There is already 50 people who aren't going to purchase their car so that means they need to sell to all the remaining people to earn their money back. With those 99 trims they may have a 98% chance of selling to the people who were appealed by all the cars, but that still means they may not get 1 of those 50 sales and their company lost a dollar. This is being nice as well, saying that they are charging twice as much as the car is worth.

Kubboz wrote:As for the OP, this can be exploited with sub-brands, I believe.

Well that's where I mentioned that different brands/models have their own manufacture buildings. Yes, technically you could exploit this to gain the increase in sales chance, you're paying the extra money for that separate manufacture plant. This is something that modern companies do for that reason, but it comes at a cost.

Look at GM. GMC and Chevy tend to have clones of each other with only slightly different looks and costs.
-In the last 30 years they owned:
Holden
Vauxhall
Oldsmobile
Opel
Buick
GMC
Cadillac
Pontiac
Geo
Saturn
Hummer
-Now only seven of the eleven exist from the bankruptcy:
Holden
Vauxhall
Oldsmobile
Opel
Buick
GMC
Cadillac

And these are just the brands that started before or in the 80's. There's a lot of brands that they have tried and discontinued.

@KillRob; any chance you could specify more on the issue?

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